Aggregate – GPI

Aggregate – GPI

Genuine Progress Indicator:Redefining Prosperity

What’s the Price of Everyday Goods & Services?

What’s the Value of Social Goods & Services?

What’s the Price of Ecosystem Goods & Services?

Market vs. Non-MarketQuestion: Where’s the Water?

New Home: Where Would You Live?What’s Most Important to You?

Gross Domestic/State ProductCurrent Definition of Prosperity? The GDP/GSP• “total monetary value of allfinal goods and servicesproduced domestically”• Does NOT include externalities• Does NOT include socialcontributions• Does NOT address social equity• Encourages defensive spending GDP muscles through: Economy brushes off• ‘Enjoys’ disastersCleaning up the spill will likely be enough toslightly offset the negative impact of all this onGDP, J.P. Morgan said. (W.S.J., June 15, 2010)storms and expands by 3.8 percent in 3Q,beating estimates. (Reuters, October 28, 2005)

“GDP…measures everything except that whichmakes life worthwhile.”‐ Robert F. KennedyMarch 18, 1968

Maryland Genuine Progress IndicatorPolicy/Budget Analysts Need an Alternative Measure• Maryland Needs EconomicPursuits; But Economic Growth ≠Sustainable Prosperity• Need to Provide Policymakerswith Balanced Metrics• Based on National GPI; Groundedin Academia• Ultimate Goal: Position Marylandfor Tomorrow’s Economy

MD-GPI: 2006-2011NOTE: All figures are in billions of year 2000 dollars

Spectrum of Tracking & GDP AlternativesNot “Better or Worse”, But What Are You Looking For?Non‐Profit Academic StateIndicators MN Compass AZ IndicatorsPlanningMD StateStat,MN Milestones,Oregon, Virginia, & NewJerseyMD Smart Growth,Hawaii 2050Aggregate GPI(Index)Atlantic CanadaAggregate GPI(Monetary)UtahVermont, Ohio,Oregon, MarylandMaryland

Scale of Alternative IndicatorsGross DomesticProduct (GDP)Genuine ProgressIndicator (GPI)Happy PlanetIndex (HPI)Gross NationalHappiness (GNH)GlobalTalberth (2000s)Maryland (2010-now)New EconomicsFoundation (UK)BhutanGNH-USAEconomic Well‐Being HappinessData/ObjectivePolling/Subjective

Why the GPI?Numbers Matter…Money Numbers Matter More• Comparability: Standard Set ofIndicators• Aggregates into Single Number• Assigns Monetary Value

Moving from Lens to ToolsGPI is NOT a Tool, but a Gauge or Lens• Operational Function versusPolitical Reality• Begins the dialogue & conversing in“Full‐Cost Accounting”• Jurisdictions dealing with multiple,often competing, goalsversus

Implementing the GPILocal Jurisdictions Integrating Multiple Goals

Implementing the GPIHow is Maryland Using the GPI• Agency Actions: Consolidations,Budgets, etc.• State Initiatives: Public Ridership,Growth Impacts, etc.• Local Jurisdictions: Meldingeconomic growth andenvironmental protection

It is better to be vaguely right,than precisely wrong.Carveth Read

Thank You!Sean

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